dependent on a chart. if you leg into something, you know my view about apple, it's an investment, not a trade. people keep telling me how do i trade apple? i say you it. my charitable trust owns it. under 600, the total breaking discipline given the low basis but pull the trigger. i promise to find it just for you on mad money. i'm jim cramer and i will see you tomorrow. larry, what are you looking tonight? >> the earnings may not stop stocks from a bigger rally. good evening. i'm larry kudlow. this is "the kudlow report." mitt romney unveils his foreign policy strategy. he says the obama white house botched the response to the terrorist attack on the u.s. embassy in benghazi. cnbc's own john harwood has the latest. good evening, john. >> good evening, larry. mitt romney tried to build on his successful debate last week by talking foreign policy today and attacking president obama as

simply not someone leading. >> i know the president hopes for a safer, freer, and more prosperous middle east allied with us. i share this hope. hope is not a strategy. >> we don't know if that line is going to work, but we know from new polls out today he's made significant headway since the debate. puts a lot of pressure on the vice presidential debate later this week. we'll talk about it at athe bottom of the hour. >> we will see you later on that very topic. also this evening, one battleground state, michigan, will vote on a state constitutional amendment to allowing collective bargaining, unlimited wage increases, and unchecked union power. michigan's governor rick snyder says how it will disrupt his state. they paid hundreds of thousands to a chicago consulting firm for training sessions where employees chant and i quote our forefathers were illegal immigrants. i think that whole story is an

outrage. we begin with another monday in the red. the dow closed down 27 points. the naz was off 24. the s&p was down just 5. this morning's "wall street journal" explains in detail whether investors should care about an earnings drop in the this third quarter. it's the first time in 11 quarters should they care. joining me now is dan greenhouse and michael from forbes magazine and co-host of sports money. that's an emmy-award winning show by the way. dan greenhouse, welcome back. you're quoted in in story as saying, yeah, earnings are down but it doesn't matter. the kudlow axiom is profits are the heart of stocks. why are you so unworried about profits falling? >> the quote that the junl took me from later down in the article was simply this is a game that gets played quarter after quarter, year after year

between up analysts and forecasters in companies. we pretend as if -- companies are very good at guiding analysts lower and coming in above that. >> the investors are fooled by that bs? >> when the world was ending fire and brim stone, 55% companies beat analysts. >> i'm more concerned. the ratio of negative preannouncement is at 4.3. the historical ratio is 2.5. we've seen companies squeeze everything they can on to expand margins, sales for employees is up 30% since 2009. what concerns me the most is before this quarter began, they were looking for 1.9% revenue growth in the s&p. it's now zero. they're saying 10% earnings growth for the fourth quarter. dan's probably right. the third quarter won't be a disaster, but no way to hit

that -- >> i'm going to have some fun with this. all those numbers, what about the fed's inflationary bubble? doesn't that drive stocks higher in the short run, earnings or not, the fed's inflationary bubble that you favor the fed bubble. >> come on. it is a bubble. >> does that drown out earnings? >> not it earnings starts to decelerate, which we see. we'll be worse than everybody is expecting in the fourth quarter. look, the pe ratio on forward earnings is 14. that's ilgts high by historical standards. the enterprise ratio is 10. that's high. that's the bernanke bubble. >> listen, first of all, with respect to this earnings season, we need to know two things. we need to know one thing, and that's the importance of energy earnings in this particular season. energy earnings are down 20%, 23% or so. that's a large portion of the decline we see. >> because all prices fell so

much. >> that's correct. >> if you take energy out, do you get positive earnings? if you remove apple from the s&p 500, things aren't that good. i'm not an eternal optimist. i think this is all perfectly fair. >> is the economy getting worse? is it getting worse? >> yes, yes, yes. it's getting worse. absolutely getting worse. >> 7.8%. >> look, worldwide, larry, the velocity of money is dead. >> what does that mean in. >> there's no turnover. this unemployment number that the optimists hailed at great at 7.8% lifted by part-time workers. >> no one said it's great. this is important to both of you since you are both in this camp with respect to the federal reserve. you can make the case -- i don't want to get too wonky and bore our viewers, but you can make the case that the federal reserve by doing what it's doing is simply offsetting the decline in monetary velocity. if they hadn't done this, but -- >> you're not fooling

corporations, though. there's no capital formation. that's why no one is hired. the male participation rate in the labor force is the lowest since 1948. >> would it be high fehr the federal reserve -- >> yes. absolutely. >> we had a strong dollar since the plaza accord in '85. >> well, look aat athe job -- >> thank ronald reagan. >> absolutely. that's why romney's tax plan is want plan we need. lower rates broaden the base. it worked in '86, '87, '88. worked in '81 and '82. let's pause there for a second. >> thanks for the lead-in about reagan. >> romney has victory in the deba debate. every single poll shows he's picked up 5, 6, 7 points. some of these local battleground states picked up 8, 9 points. is does that change your stock market outlook from bear to bull? >> you get rid of obama care and

3.8% tax on investment income and get the tax on medical device makers, larry. >> i will bet you $20 right now. i'll make a romney $10,000 bet that obama care is not repealed. >> i'll bet you it will be repealed, but i'll buy a gift for your new daughter. >> thank you. >> if romney wins, which was not expected a week ago but is now more expected, if he wins what is the stock market impact? is it greater than earnings and the federal reserve? how do you assess a romney victory? >> what becomes important is the effect on capital gains and dividend taxes. we as investors view asset investments on an after-tax basis. they make those particular investments more attractive, and we saw this with respect to to t cool stocks. >> the average small business has 2.5 employees, the average is over 5.

small businesses get a boom in that. >> i don't disagree with what you're saying but i focus on the tax policy. >> they'll go sky high if romney loses and skier higher because of obama care. >> that said, just to repeat, i disagree. >> all detriments to growth. >> detriments to growth. if romney wins, the odds of obama care being fully repealed are virtually nil. >> the worst aspects of it -- no one can appreciate that future. let me make two points. the worst aspects, the money onerous spending and taxing aspects of obama care may be repealed. secondly, romney made a deal to stop the fiscal tax cliff. he will start in right away. >> assuming he takes the senate. >> this is a time when earnings may not be near as important. >> we shift our economy back to an incentive-based economy and aaway from an entitlement economy. that's the biggest way to sum it

up. >> do you have a problem with na? that paradigm that michael just uttered, which the romney paradigm versus the obama paradigm, do you have a problem with that? >> i don't see why anybody has a problem with that. that's a winning argument. to sort of start a fight on the set, i would say if obama is re-elected, the world will not end. it will look less aattractive from an investment environment. >> how many dow points will fall if obama is re-elected in your opinion? >> i would say 10% at least. >> just because obama wins? >> absolutely. >> and his policies? >> i'm just baiting you and see how you come out this. >> the policies are for real. the fact that he wins the stock market. >> a no growth economy is not going to support a price earnings ratio. >> obama believed in capitalism and believes in a different type of capitalism than other people. the other point is that -- the same argument was made in '08 and the stock market went up

100%. >> after getting crunched on the way down. thank you very much. we tried. coming up, unchecked, unlimited union power. oh, my goodness. in 30 days michigan is going to vote on a union-backed ballot member to make unionizing a constitutionally protected right. the michigan governor joins me next. he has something to say about that. later on, mitt romney blasts obama's foreign policy calling for the u.s. to play a tougher role, especially in the middle ea east, and slamming obama saying hope is not a strategy. free market capitalism is the best path to prosperity. we need it in the middle east and need it in the usa to give us a 20,000 dow. i'm kudlow, and we'll be right back.

the industrial heartland was once a stronghold for organized labor, but in the wake of scott walker's courageous and successful efforts to curb out of control collective bargaining in wisconsin and indiana becoming 23rd state for right-to-work. in 30 days a un-backed proposal

could make the right to unionize a constitutionally protected activity. in other words, unchecked, unlimited power that could overstep any reforms. here now to discuss it is michigan republican governor rick snyder. welcome back to the show. this is a very unusual piece of legislation actually on the constitutional ballot. what's your take on this? where is it going, and waehat's your view? >> it's a very bad thing. they like to call it the collective bargaining proposal, and i call it the back in time proposal. it takes us back many steps. teld challenge a lot of great reforms we've done. michigan is the comeback state, and this is a major step back. >> if this passed, would this prevent emergency actions by the state government? there's some descriptions about school districts, small towns going bankrupt, even detroit. would this prevent any of those emergency actions? >> well, it would make it very

challenging. in fact, we have an emergency manager law used, but when it's used it's a major help to prevent bankruptcies and other challenges. that's also on the ballot. this would override that and leave us in a spot where communities might have bankruptcy as an option, and that's a very bad answer. >> governor, let me just ask you, what are the mechanics of this thing? in other words, if they get collective bargaining as a matter of state constitutional rights, does that undo all of your reforms as you call it to the michigan comeback? does that give the unions power even over the state legislature? is it that bad? >> it would in many aspects take us back in time and give a lot of power to unions in terms of the negotiating process and really wipe out a lot of benefits we have. we're the comeback state. we've gone through tough recessions before. we need to keep going. that's where i encourage our

citizens to get out there look at the details of this and vote no on proposal two. >> will this bring out a bigger turnout? i've seen recent polls that show the state of michigan a toss-up between romney and obama, and, of course, romney had a great debate night. is it go to bring a bigger turnout? does it help romney? >> it could bring a bigger turnout. i'm a big supporter of governor romney and i want to see him do wm. michigan is a poster child for what washington needs to do. washington is a mess. we've shown in michigan and some of the surrounding states that we know how to balance a budget and pay down liabilities and done tax reform. it's a great comeback story. we did that in a year and a half. there's no reason washington couldn't do the right thing with the right leadership. >> can can i ask one last question. you opposed this going on as a state constitutional right. i get that. where is collective bargaining now? is it good in some places, not good in others?

how does it work now, and where would the changes be? >> well, that's one of the things, larry. when they talk about it, they call it collective bargaining proposal. it has it's role and place. i've done it successful twice now with state employee groups and it works well. what this would do is wipe out a whole bunch of other reforms in terms much pension and other benefits, ways we reinvent michigan in a positive way. that's where i hope our citizens turn out to say we have a comeback and let's not move back in time. >> i get that. regarding governor scott walker in wisconsin and governor mitch daniels in indiana, they passed tougher laws restricting collective bargaining. indiana is a right-to-work state now if i'm not mistaken. do you want to go that far over aa period of time? >> what i said from the time i started campaigning, i didn't put right to work on my agenda.

it's decisive issue. we have great results in michigan, a lot of positive progress. this tees up right to work as an issue as a practical matter. i asked the labor community not to do this ballot proposal because we're showing great progress, and we don't need to be fighting with one another. it tees up a fight into other issues through this proposal process. i want to see michigan keep moving forward, and i believe that's what all the citizens want. hopefully that will show up well in november voting no on the profl pofl. >> thanks very much. good luck on the effort. up next, alarm bells ring throughout federal and state health communities. the cdc believes 13,000 people are at risk in the rare meningitis outbreak that's already killed at least eight people. it's a rough story, and the full story for it is coming up next.

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where did you get that sweater vest? your ford dealer. the centers for disease control warned that the outbreak of meningitis tied to a contaminated drug has multiplied and health workers are now trying to find thousands more patients who are potentially exposed and may not know it. tom costello has all the latest. good evening, tom. >> hi, larry. the words for the centers for disease control as many as 13,000 people across the country may have received one of these contaminated steroid injections coming from this one company up in new england.

now they're trying to figure out who may have gotten one of these injections and get the word out for them to follow-up with doctors as soon as possible. 23 states in total received shipments from the new england compounding center. 105 confirmed cases as of now, 8 confirmed deaths, and most of those or at least a good number of them are in tennessee where they have four deaths. the focus, again, is on this company out of new england, the new england compounding center, which investigators now believe was producing a contaminated version of a steroid that has now gone across the country at least 17,000 different shipments, if you will, across the country. larry, back to you. >> all right. many thanks. nbc's tom costello. up next, mitt romney unveils his foreign policy strategy with strong words aimed at president obama. take a listen. >> the 21st century can and must be an american century. it began with terror and war and

economic calamity. it's our duty to steer it onto the path of freedom and peace and prosperity. >> how obama's hope and change has left america weaker in the region and around the world. that's next, mitt romney's foreign policy speech.

welcome back. in the wake of strong debate performance last week, mitt romney hoped to capitalize on his momentum, and today delivering a major foreign policy address in virginia accusing president obama of a lack of leadership on the global stage. cnbc's john harwood joins us again with additional details. good evening. >> good evening, larry. mitt romney spoke at the virginia military institute in the very important swing state of virginia. he didn't lay out much of a policy contrast with president obama. they're in similar places, but he did cast a contrast in terms of himself as a man of action and president obama who is somebody who is more passive. here's mitt romney. >> it is our responsibility and the responsibility of the president to use america's greatest power to shape history,

not to lead from behind leaving our destiny at the mercy of events. >> now, what mitt romney is trying to do is drive some of the polls that have shown significant progress for him post-debate. look at these three. it's a mixed verdict. you have, first of all, the very well respected pugh research center poll shows mitt romney moving from being behind by 8 points to being ahead by 4 points. the rasmussen poll out this morning also conducted post-debate that show them tied. rasmussen has a reputation for being a poll that makes republicans look good. gallup is considered a nonpartisan poll, not one with a tilt one way or the other. they show president obama up five points, though much closer for the post-debate portion of the sample. president obama was on the west coast today courting latinos, and he gave some remarks about the state of the economy and how it affects latinos. >> no matter who you are and

what you look like or where you come from, this is the place where you can make it if you try. today we have more work to do to fulfill that promise. the recession we're fighting our way back from is still taking a toll, but thanks to the strength and character of american people, we are making progress. >> now, of course, latinos are one of the reasons president obama has been doing well in some of the western states like colorado, nevada, new mexico, as well as florida. we now have to see gin the smift in polls whether he can continue to remain on top and it sets up the vice presidential debate on thursday between paul ryan and vice president joe biden, larry. >> all right. i'm looking for some rock 'n roll in that debate, john. >> you'll get it. >> many thanks to john harwood. let's get right to the distinguished panel. former assistant secretary of defense larry corps who worked in the reagan administration and richard williamson who is a

senior romney foreign policy adviser. welcome, gentlemen. ambassador williams, i read the speech and tried to read it carefully. mitt romney is very critical of how president obama handled the benghazi killings and so forth and security risks. i want to ask you though specifically. in your judgment does mr. romney believe there was a cover-up going on in the white house when they put out susan rice, they already knew it wasn't the video. it was actually the al qaeda terrorists and others related to it that? will romney in the debate next week talk about a benghazi security cover-up regarding the baha obama white house? >> thanks for letting me be on. benghazi has to be seen we had 20 embassies in the greater middle east where demonstrations took place. we had four compounds breached, american flags burns and the black flag of al qaeda raised.

it was a disgraceful day, and it was evidence of a failed middle east policy. on benghazi itself, governor romney's been very clear. the president of the united states owes the american people candor and transparency on what's happened. that clearly has been a test which has been failed. they started talking about the spontaneous eruption that was incredible on 9/11, and this is a video that's been around for months. second, we have the type of equipment used. third, we now know there were intelligence reports. fourth, wern the ambassador was concerned about the security, and fifth, we had a stonewalling for days and days with this very story. >> that's the key point with ambassador rice making the runs. larry, do you agree with rich williamson, larry, that, in fact, president obama owes the american people a clear, transparent explanation? >> i think he has given it. you have to remember everything

rich said is contradicted by the director of national intelligence, general clapper, who was first appointed to the pentagon by the bush administration. he came out and he said, i gave them this information, and it was wrong. when we found out, i changed the narrative, and more important, obama's going after the people working with the libyan government. we already have a couple of the people who participated in this. so the idea there was a cover-up is nonsense. you know, fine. i remember from my days in the military and the days in the pentagon, you have to be careful. the first reports are always -- could be misleading. >> larry, my friend, that's not credible. >> no, no. clapper is the one. he's a nonpolitical guy. are you saying clapper is lying, rich? no. >> i'm saying if there was evidence there, you know it and i know it, the american people know it because it's come out. it's not come out -- >> it has come out now. it has come out. >> the administration stonewalling.

the american people deserve some transparency. furthermore, the major -- >> one at a time, please. let ambassador williamson and we'll bring you back, larry, i promise. >> okay. >> the major issue is president obama thinks terrorism can be dealt with only by drones and focused killing. as governor romney said today, it's a broader struggle between the extremist islamists and moderate factions throughout the greater middle east. as long as the president thinks that the answer is targeted drone attacks aalone, we'll continue to fail. that's why you have this turmoil. you have the failure in iran, the failure in syria. these 20 embassies where there are demonstrations. this administration's middle east policy has failed. it's irrefutable. >> larry let me ask you -- >> sflulgts nabsolutely not. we have the tougher sanctions. >> that the republicans passed. >> and we have the whole

international community behind us. >> larry -- >> basically romney was on posed and you were opposed to what they were doing in libya. if it was up to you guys, gadhafi would still be there. this is the people in the middle east taking control of their own destiny. the drone strikes have decimated al qaeda's leadership. this group that attacked in libya had no connection to al qaeda central. we got bin laden. i mean, we got the whole -- we got the whole leadership. this group that attacked the consulate in libya has no more connection to al qaeda central than your local gas station has to bp headquarters. >> can i respond to that? >> yeah, go right ahead. >> first of all, how can you say it succeeded when iran has thousands of more centrifuges, has enriched eyuranium to 20% a all the efforts of the administration to halt this

climb this approach to nuclear breakout have failed. this is irrefutable. they're closer to nuclear breakout, and we have a hemorrhage with israel, the most reliable and important ally in the region, as opposed to working closely with them. the president is more interested saying no to israel from defending itself than no to iran on nuclear weapons. >> larry, rom my nad the charge in his speech today that under a romney administration there will be no daylight between israel and the united states. quote-unquote. what governor romney is saying is that under team obama there has been daylight between israel and the usa. do you agree with that? >> absolutely not. the disagreement had nothing to do with iran. it had to do with romney's position on whether we should have a separate palestinian state. he came around and changed this one. that's the obama policy from the policy of every president going back to nixon. >> to >> i have to leave it there,

gentlemen. >> not having time to meet with bibi netanyahu in new york. >> he spent an hour on the phone with him. >> meetings and phone calls, we'll have them again. we appreciate it. let's turn to another explosive story making major headlines today. china cyber hacking our biggest tech companies and posing aa risk to the national security. the house intelligence committee said american companies should avoid doing any business with china's two leading technology fir firms. here's house select chairman mike roberts on "60 minutes" last evening. take a listen. >> if i was the american company and as the chairman of the house permanent select committee on intelligence and you were looking at wawai i would find another vendor. if you care about intellectual property and you care about the national security of the united states of america.

>> should this be a national security concern? let's bring in our guest now, retired four-star general and nbc military analyst, barry mccaffrey. thank you, sir. first of all, wawai, should we stay away from them? no matter what they say, do you regard them as a security risk? they've been operating in the states. you know that. are they still a security risk? >> look, first of all, there are huge telecommunications countries, the second biggest until the world. gt is the fourth biggest in the world. and they're also without a question a cyber threat to america. the u.s. cyber command said last year probably the chinese stole $300 billion worth of intellectual property. there's the major cyber reconnaissance and attack on the united states, our banking system, the pentagon, you name it. so they are a major threat, and they should not be allowed to

inside the united states control our circuitry. >> would you push them out? they're here and operating here. would you push them out? >> they have about 1900 employees here and do a lot of good in various ways. their handsets, nsa, has said they're not a threat to us. the notion they can do end to end telecommunications, which they've done in one part of kansas already, i think is bad judgment. congressman rogers has done a huge service for the united states by raising this up as a concern. >> you know, some of the frpres reports say there are chinese communist party committees. they're little committees in all big chinese companies and that they have a secret jaent or not so secret to them. the united states companies doesn't have that. these guys do. they're still communists. does that enter yue your thinking on this? does that prove de facto we

can't trust them. >> there's probably a doss left in china than about their probable connections to chinese people's liberation army cyber command. there are some allegations aalong that line. there are allegations that wawei communications do beaconing where they're signalling intelligence back from their proprietary networks back to china. there are allegations that they have bribed or tried to bribe for espionage reasons u.s. citizens. larry, i don't think there's any economy they're a great telecommunications company and also a direct threat to the national security. >> you said earlier you thought it was chinese companies doing cyber hacking on american bangs, say he ran from it and then they

got the cyber hacking technology from china. >> i think everything is do it, from teenagers in lithuania to russian criminals. you name it. in terms of organized empties, i don't think there's any question. the chinese represent the principal threat to cyber espionage and reconnaissance and reconnaissance with a view toward the unlikely event if there was war between the u.s. and china. they would use this as an additional strategic tool of attack in the united states. i might add, larry, if i was in public office, i could not be talking this way. nobody wants a confrontation between china and the united states. in the background we ought to recognize, wait a minute, 20 years from now they are trying to create a global navy and air force capable of dominating the pacific out to hawaii. >> we'll leave it there.

thank you very much, sir. coming up, the usda is accused of spends hundreds of thousands of taxpayer dollars on so-called diversity training sessions in which employees were allegedly told to chant. are you ready for this. quote, our forefathers were ill legal immigrants. huh? i don't get through any of this it. we'll get to the bottom of it next up. you're paying for it. [ female announcer ] the best things in life are the real things. nature valley trail mix bars are made with real ingredients you can see. like whole roasted nuts, chewy granola, and real fruit. nature valley trail mix bars. 100% natural. 100% delicious. a short word that's a tall order. up your game. up the ante. and if you stumble, you get back up.

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during a u.s. department of agriculture diversity training workshop employees were told to chant our forefathers were illegal immigrants, end quote. this is another example of brainwashing of obama's agenda at taxpayer expense? i don't get it. here's the founder of judicial watch. let me get this right. they pay the chicago consultant hundreds of thousands of dollars to have chants, our forefathers were i willegal immigrants. what's this all about? >> it's about as absurd when

bill clinton claimed during the monica lewinsky scandal our founding fathers were philanders. this is an outrage. >> this is different than bill clinton. i want to stay with this ag department. we talked about the gsa and all the corruption going on. they're willy-nilly taking taxpayer dollars. i don't know if you know how much. the reports say a couple thousand dollars and have people chant. i don't like chants, by the way. i'm offended by that part, too. how much dough did they spend on this chicago consultant? >> if they're willing to admit 200,000, it's probably a lot more. this is a government-wide program. we had the same thing going on at nasa with the administrator a couple years ago when he was going it to outreach with muslims and we had it with the fbi director last year when he met with muslim groups. it's one thing to create

diversity transformation, but it's another thing to use taxpayer money for these things when it's not what the agencies are about. it's clearly inappropriate. >> this is the agriculture department. what does this have to do chanting our forefathers were immigrants? fine. what does chanting that have to do with the mission of the u.s. department of agriculturagricul. i don't understand na. >> absolutely nothing. what happened is over the years there was some discrimination aat the usda. then they brought in a program called pickford, and billions were paid out on fraudulent loan applications in the usda. the usda put into effect during the obama administration to try to reach out to minority groups. that's a worthy goal, but you don't do it with taxpayer money when it's irrelevant to the mission of the agency. frankly, it's something to be done in a different way.

>> this has a gsa feel to it. it has nothing to do with the ag department's mission. it's wasting taxpayer money. the whole idea having people chanting, larry, is so offensive to me. these are federal employees. these are adults. i can't -- someone has to investigate this. this one really smells. >> absolutely. it creates animosity between the races. it doesn't help anything. it actually makes it worse. >> it sends the wrong message at the very least. alarry, thank you very much. >> you're welcome. we asked the usda for a statement. here's what they told us. quote, usda offers a number of optional workshops and professional development opportunities in order to help employees better serve our customers. the suiter and those sessions were designed to foster overall diversity awareness and not to focus on a minority group and

receive positive feedback from employees across the department. i want to thank the usda for its response, but it sounds like brainwashing. i'm completely offended by the idea of having employees chanting anything, okay? i find that completely offensive. it's way off base, and whoever runs this program in the u.s. agriculture department should be called to testify before darrell issa or one of the other investigating committees. this is a joke and farce. a new obama bombshell. the government accountability institute reports that the president's campaign may have violated federal election law by accepting illegal overseas donations. that's next up. please stay with us. two years ago, the people of bp made a commitment to the gulf.

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is president obama's campaign on the up and up with all its donors. peter doesn't think so. his government actability institute published america the vulnerable and it says the obama campaign is riding rough shod over the prohibition on foreign contributions. it points to obama.com. it's a website purchased by an obama bundler based in shanghai, china and says 68% of the traffic to obama.com is foreign. the study continues that obama.com lacks minimal credit card security or verification, and that's where the money

flows. it's too easy for foreign governments to finance presidential campaigns. that's the problem, including mr. obama. this won't go aaway. somebody has to look into it. everything was changed since the presidential debate. there's no denies the solid mitt romney rally, but it's the biden/ryan debate later this week everyone is waiting to see. you can see it here on cnbc beginning with "the kudlow report." here to discuss it is keith boykin and sarah fagan. i'm really excited about the ryan/biden debate, and i want to say -- by the way, i'm not a guy that's going to make a lot of fun of joe biden, because i think he can be very effective. where is biden going to go? where is he going to go for the first crunch, the first sword in the ribs to paul ryan? >> i think the ryan plan. i think that's what he'll go

for. on the one hand mitt romney kind of endorsed the ryan plan but he's walked away if it. i think he's going in on that, and he'll go in on the inconsistencies on where ryan and romney stand on the issues. he will force ryan to sort of defend his candidate and stand up for him, and i think he's also going after foreign policy. joe biden used to be the chairman of the senate foreign relations committee. >> even though he's one of the worst in history. >> paul ryan has no foreign policy experience at all. >> i'm waiting for joe biden appear par thid division of iraq. it's not true. ryan has made had trips abroad including the middle east. >> they did fund-raiser abroad, too. >> i didn't know that. >> they did in london. >> i think joe biden will be very formidable. i think the challenge for paul ryan in the debate is he has to come across in complete control of the facts.

when you see a 27-age year difference between these two, it's very easy for a young person like ryan to get schooled by the senior biden. he can't let that happen. at the same time he's got to be respectful. i would argue that this debate is more important for these candidates, for these presidential candidates than usual, but it's style more than substance at the end of the day. >> it doesn't make a difference in the end i think it will be an exciting debate. the gloves will be off. in the end it won't move the polls much or make a huge difference. the only advantage out of this for the democrats for obama is that if biden really does well, they finally regain some of the enthusiasm they lost after the debate performance. >> i want to inject this in. biden's got a problem, and that is paul ryan's youth and aattractiveness. you're going to say -- this may be unfair. this may be unfair.

>> for better or worse. >> i'm an old guy myself. i'll say this, ryan's youth he looks like john f. kennedy. his excitement, his enthusiasm, and his knowledge. i mean, whatever biden says and i know he's coming after ryan's budget, ryan will be able to respond. i'm saying the young ryan will make a hell of a contrast with biden. >> he is. the risk for the obama campaign is there's so much pressure to make up for last wednesday night that joe biden comes off too aggressive and overreaches and as a result of that, they dig further -- he they dig a further hole. >> i don't think there's a possibility that joe biden is too aggressive. he's an aggressive guy. >> he's a really aggressive guy. >> they're supposed to be aggressive. >> when you're too aggressive, you say things that come back to haunt you. >> no. the problem that biden gets into is when he talks to his own supporters. he gets too excited talking to his own supporters and fans.

i doesn't get in that problem with debates. when i worked on the michael do you dukakis debate. the age difference won't make a difference. >> it's going to be an unbelievable contrast. >> it won't make a difference in ryan's favor but in biden's favor. >> i don't think so. >> it will show how little experience paul ryan has. he doesn't look -- i looks like a boy scout. he doesn't look ready to be president. one heartbeat away. >> it's important for paul ryan to be in command of his facts. he can't say the numbers are complicated. he has to go through his social security and medicare -- >> he doesn't have enough time to explain his plan. >> he'll have plenty of time to do it and has it to p perform. i think you're right. he's a smart guy and he can do it. he's got to check his nerves at the door. >> i think joe biden is all tied into knots. he's taking six days off to plan for this.

what is it about obama and biden? they're always cramming. obama crammed. >> they're running the country. they have something to do. they're not just campaigning. what job does mitt romney have, first of all? he has no job other than to be a candidate, which is the only job for the past five years. meanwhile, barack obama and joe biden have been running the country for the past three and a half years. >> really? >> so they don't have a day job. >> what's your response to that? >> i think he's going to overrooch, and the reason i think that is if you look back in 2008, there was all this talk about palin, she couldn't perform. >> she whipped biden in 2000. >> she whipped him, and she was young like ryan. i'm telling you. >> the bar for sarah palin was so low that anybody could have passed that bar. >> the bar for joe biden is so high because of how poorly president obama did last week. >> the ryan is setting him up. >> they down-played expectations for obama, but they're

sufficiently overplaying expectations in some ways for joe biden. i think he'll do a good job. i don't think anybody has a problem saying that, even the democratic side. >> he's going to see the middle class got hosed undered regime and ryan will jump all over it. sarah, we must visit us more. we miss you. thanks for watching. i'm larry kudlow. i can't wait for ryan versus biden. youth will be served. when you take a closer look... ...at the best schools in the world... ...you see they all have something very interesting in common. they have teachers... ...with a deeper knowledge of their subjects. as a result, their students achieve at a higher level.

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